The agreement to extend the interim nuclear agreement with the West will prevent Iran’s oil exports falling by as much as 20 percent, a senior Iranian oil official said on Friday.

Mohsen Qamsari, international affairs director at the National Iranian Oil Company, said Tehran had benefited little from the so-called Joint Plan of Action agreed with six world powers in November 2013, implemented for six-months on January 20 and extended last Friday until November 24.

“The only positive point about the recent negotiations was that Iran was spared a 20 percent fall in its oil sales,” Qamsari said, quoted by oil ministry news service Shana.

The interim deal, or JPOA, gives Iran some relief from the sanctions that have slashed Tehran’s oil exports, the country’s main source of income, in exchange for concessions on the nuclear issue. As part of the deal, the EU agreed to lift its ban on the provision of insurance for shipments of Iranian oil.

But Qamsari said Iran had not been able to benefit from the lifting of the insurance ban because of the short-term nature of the agreement.

“Short-term agreements have a no war-no peace nature. Such agreements make conditions for Iran’s oil sales unclear because issues like shipping, banking and insurance are long-term matters and companies active in these sectors usually don’t have any desire to change their activities in the short term,” he said.

“Nothing particular has happened in this regard,” he added, referring to the lifting of the insurance ban.

“In the past six months, no company agreed to provide insurance for Iranian oil tankers, and it seems unlikely that in this new four-month agreement anything will happen either. In fact, these negotiations have had no quantitative impact.”

However, Qamsari said the removal of pressure on Iran’s customers to make further cuts in their imports of Iranian oil was positive in that it was “possible to negotiate with oil buyers away from tension.”

Six countries -- China, India, South Korea, Japan, Turkey, and Taiwan -- have continued to buy Iranian oil under a waiver from U.S. financial sanctions in effect since mid-2012 by reducing their import volumes.

Iran had been exporting some 2.2-2.3 million b/d of crude before the U.S. and EU sanctions came into effect in late June and the beginning of July two years ago. Last year, according to International Energy Agency estimates, imports of Iranian crude by the six buying countries averaged just 1.1 million b/d. But in recent months, combined import volumes have been rising.

In February, for example, the import total for the six averaged 1.47 million b/d, according to official figures and, in the case of India, shipping data analyzed by Platts. The volume eased back to 1.26 million b/d in March, edged up to 1.29 million b/d in April and climbed to 1.46 million b/d in May.

(Source: Platts)

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